SOCIAL REALITY Inc (SCRI) saw its loss narrow to $2.03 million, or $0.26 a share for the quarter ended Mar. 31, 2017. In the previous year period, the company reported a loss of $2.40 million, or $0.41 a share. Revenue during the quarter went down marginally by 2.62 percent to $5.33 million from $5.47 million in the previous year period. Gross margin for the quarter contracted 341 basis points over the previous year period to 38.43 percent. Operating margin for the quarter stood at negative 60.26 percent as compared to a negative 27.72 percent for the previous year period.
Operating loss for the quarter was $3.21 million, compared with an operating loss of $1.52 million in the previous year period.
Adjusted EBITDA for the quarter stood at negative $1.74 million compared to negative $0.98 million in the prior year second quarter. At the same time, adjusted EBITDA margin stood at negative 32.66 percent for the quarter compared to negative 17.93 percent in the last year period.
“Over the past year, we have expanded our offering, creating new high growth revenue streams like SRAX Reach, and established a leaner infrastructure. While not evident in our first quarter financial results due to our buy-side legacy business, we expect these strategic measures to generate growth and operating efficiencies beginning in the second quarter and increasing in the third quarter, as the legacy issues dissipate,” stated SRAX’s chief executive officer and chairman Christopher Miglino. “In late March, we right-sized our buy-side sales team and consolidated operations to our LA headquarters. Also, with our eye on the future of advertising technology, we began implementing our SRAX rebranding to reflect the breadth and depth that our platform offers marketers and content owners. To broaden our customer base and expand our product offerings to additional buy-side clients, we designed our tools to improve performance across all digital channels for brands in any vertical. We remain confident about growing our 2017 revenue to range between $45 million and $50 million. And with our cost management efforts, including our reorganization, we expect to dramatically improve profitability on an Adjusted EBITDA basis year-over-year.”
SOCIAL REALITY forecasts revenue to be in the range of $45 million to $50 million for fiscal year 2017.
Operating cash flow remains negative SOCIAL REALITY Inc has spent $0.61 million cash to meet operating activities during the quarter as against cash outgo of $0.12 million in the last year period. Cash flow from investing activities was almost stable for the quarter at $0.14 million, when compared with the previous year period.
The company has spent $0.18 million cash to carry out financing activities during the quarter as against cash inflow of $0.63 million in the last year period.
Cash and cash equivalents stood at $0.12 million as on Mar. 31, 2017, down 92.54 percent or $1.48 million from $1.60 million on Mar. 31, 2016.
Working capital remains negative
Working capital of SOCIAL REALITY Inc was negative $8.57 million on Mar. 31, 2017 compared with negative $5.18 million on Mar. 31, 2016. Current ratio was at 0.45 as on Mar. 31, 2017, down from 0.57 on Mar. 31, 2016.
Days sales outstanding went up to 115 days for the quarter compared with 100 days for the same period last year.
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